Alabama beer brewing growth slowed to 47 percent in 2013

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BIRMINGHAM, Alabama – Beer production in Alabama grew 47 percent in 2013, a healthy growth by most measures, but much slower than the industry grew in the previous three years in the state.

The Alabama Brewers Guild released its 2013 annual report Thursday. It reveals brewing remains a growth industry in the state while suggesting the rate of growth may not be as explosive as recent years.

Among the findings:

The number of taxable removal barrels (the amount of beer sold and taxed) was 28,373 in 2013, up 47 percent from the 19,301 in 2012.

Employment nearly mirrored job growth. There were 121 people working in the brewing industry in 2013 compared to 85 in 2012, an increase of 42 percent. Jobs had grown 204 percent, 250 percent and 100 percent in 2012, 2011 and 2010, respectively.

The number of existing breweries nearly doubled from seven in 2012 to 13 in 2013.

The number of planned breweries also nearly doubled from seven in 2012 to 12 in 2013.

The number of brewpubs did double from two in 2012 to four in 2013.

The amount of beer being put in kegs decreased from 61 percent in 2012 to 51 percent in 2013 while more was going into bottles, 16 percent in 2012 compared to 27 percent in 2013. Virtually the same amount, 23 percent in 2012 compared to 22 percent in 2013, was being packaged in cans.

Alabama is selling more beer out of state. In 2012, Alabama brewers sold 88 percent of its beer in Alabama and the remaining 12 percent out of state. In 2013, 86 percent of sales were in-state with 14 percent going out of the state.

Production more than tripled between 2009 and 2010 (growth of 278 percent) and more than doubled from 2010 to 2011 (104 percent) and from 2011 to 2012 (118 percent). Although 47 percent growth is nothing to sneeze at, Dan Roberts, executive director of the Alabama Brewers Guild, said in an interview the growth was lower than expected.

“It’s actually less than anticipated,” he said. “It could have been higher.”

Roberts said he could not go into specific reasons why the production rate was lower than expected because it would reveal too much about the business practices of individual brewers. He said there is still plenty of room for growth for the brewing industry in Alabama.

“I think we’re still catching up to the pent-up demand,” Roberts said. “For the most part, these guys can’t brew beer fast enough.”

Roberts said doubling annual production remains a possibility.

“I think there is growth in the foreseeable future,” he said. “I’m not going to predict 100 percent growth, but it wouldn’t surprise me.”

Roberts said several of the larger brewers have added or are adding new equipment and are not yet producing at full capacity.

The bill introduced in the Legislature would have allowed a brewer like Stone to operate a brewery, restaurant and retail shop as part of one development. That is currently not allowed by Alabama law. However, the bill would have restricted those privileges to a brewer the size of Stone and would have left out all of the smaller breweries that now exist in the state. Stone didn't seek the exclusion of smaller brewers, siding with them publicly.

Roberts said the state would realize greater growth by passing a new law without such restrictions – boosting the existing industry while serving as an enticement to recruit breweries like Stone to the state. The bill ended up dying without coming up for a full vote.

“Without the legislation, it absolutely hurts our chances of getting Stone to locate in Alabama,” Roberts said. “I think we’re in a good position for next year to get something passed. It puts a spotlight on the fact that brewing can be a sizable industry.”